Rebana Maju Sdn. Bhd. v Hong Xin Construction Sdn. Bhd. (BA-24NCvC-1395-07/2024)

This Court is empowered under Order 29 of the Rules of Court 2012 and sections 50-54 of the Specific Relief Act 1950 to grant an anti-suit injunction to prevent a multiplicity of proceedings. Reference was made to a Court of Appeal case of Mobikom Sdn Bhd v Inmiss Communications Sdn Bhd [2007] 3 MLJ 316, which states: "There is no doubt that a court has jurisdiction and power to grant an anti-suit injunction whenever the interests of justice call for or demand it. So an injunction may be issued by our courts to restrain the institution or prosecution of a suit in a foreign jurisdiction where this would lead to a multiplicity of proceedings."

Plaintiff submitted that the Second Adjudication was similar to the First Adjudication which was set aside by the KLHC, and Plaintiff had appealed against that decision, which is still pending. A Federal Court case of Jaya Sudhir a/l Jayaram v Nautical Supreme Sdn. Bhd. & Ors (2019) 5 MLJ 1 was referred, which states: [44] … … We must highlight in this regard that the general test for interlocutory injunctions as laid down in Keet Gerald Francis is whether there are issues raised by the parties in the suit that are serious enough to merit a trial. In doing so, the court has to ask itself whether the totality of the facts presented before it discloses a bona fide issue to be tried. [66] … … we are compelled to add that the desire of courts to avoid disruption and multiplicity of litigation, in particular to avoid parallel proceedings and the risk of inconsistent findings, and to avoid the causing of inconvenience to third parties also rests on court's powers to protect its own proceedings and processes by granting anti arbitration injunction.

Therefore, an order for an injunction is required to avoid a multiplicity of proceedings and inconsistent findings, which will render the appeal nugatory and cause losses to the Plaintiff's business, which damages cannot compensate. It was also submitted that this would be an abuse of process of the Court by the Defendant to issue a payment claim similar to the First Adjudication. [12] The Defendant objected to this application on the following grounds:

Plaintiff's Payment Response to the Second Adjudication clearly shows that Plaintiff did not challenge Defendant's right to raise a new Payment Claim nor challenge the right of Defendant under CIPAA. The Plaintiff has merely reserved its right with regard to the pending appeal.

The KLHC order confirmed that the entirety of the Adjudication Decision had been set aside.

It is trite that when an Adjudication Decision has been set aside, the effect of which is that the adjudication proceedings between the parties never took place. The parties are back in the position that they were prior to the commencement of the adjudication proceedings.

Reference is made to a High Court case of Wong Huat Construction Co v Ireka Engineering & Construction Sdn Bhd [2018], which set out the effect of an Adjudication Decision which has been set aside wherein it was held as follows: "[46] What would be the effect of a successful setting aside of an adjudication decision? All parties will be restored to their original positions as though the earlier Adjudication did not take place. This would entitle the unpaid party to commence fresh adjudication proceedings on the payment claim which decision has been set aside. I agree with learned counsel for the claimant that there is no basis to hold that once an adjudication decision is set aside on any of the grounds under s 15 of the CIPAA, a party is barred from subsequently initiating a fresh adjudication proceeding and that the only recourse would be to arbitrate or litigate the dispute."

It is clear from the KLHC order that the Adjudication Decision has been set aside pursuant to Section 15(b) of CIPAA based on a breach of natural justice (excess of jurisdiction) committed by the Adjudicator.

Therefore, it is clear that the effect of an Adjudication Decision that has been set aside is that parties are placed in a position as if the adjudication proceedings did not take place, and the Defendant is at liberty to issue a new Payment Claim in line with its statutory rights under CIPAA. Findings and Analysis [13] The CIPAA [Act 746] came into operation on 15.4.2014 to facilitate regular and timely payment with respect to construction contracts and to provide speedy dispute resolution through adjudication. In Martego Sdn Bhd v Arkitek Meor & Chew Sdn Bhd & Another Appeal [2019] 8 CLJ 433, the Federal Court states that the primary objective of CIPAA was to alleviate cash flow issues in the construction industry through an effective and economical mechanism by creating an expedited adjudication process. [14] In the present case, the parties cooperated in the development of the said project and were bound by all relevant contracts between them. As development progresses, payment applications can be made under section 5 of CIPAA. The Defendant submitted a claim, but the Adjudicator dismissed it. Defendant then initiated a setting aside application of the whole Adjudication Decision, and the learned Judge at KLHC decided that the Adjudicator has no jurisdiction to decide on the Defendant's entitlement for rectification of defective works without first deciding on the legality of the Plaintiff's determination of its own employment and the Adjudicator had acted in excess of jurisdiction. [15] Hence, I therefore agree with the Defendant's contention that the consequence of such findings renders the adjudication decision void and of no effect. [16] I am of the view that the above decision has resulted in the adjudication process being vitiated and deemed void. [17] As the entire adjudication decision has been set aside, the parties have been restored to the position they were in prior to the commencement of the adjudication proceedings and can, therefore, be permitted to re-adjudicate the matter by issuing a fresh Payment Claim (pursuant to section 5 of CIPAA). [18] The legal position in relation to a stay pending appeal is trite that the appeal does not automatically operate as a stay. Plaintiff has conceded that they had not sought a stay order at the time they filed the appeal. Therefore, it would be inappropriate for this Court to then grant an injunctive relief. [19] On the issue of stay, the Plaintiff has submitted that the likelihood of them succeeding before the Court of Appeal is high and, therefore, constitutes good cause for this Court to grant the injunction. Unfortunately, I disagree with the Plaintiff. If I were to grant this application on this basis, it would be based on prediction and assumption of the outcome of the appeal. This would not be a valid consideration or ground. [20] As mentioned above, the parties are back in their original position, so the issue of multiplicity of proceedings does not arise as there are no pending or ongoing adjudication proceedings. If the Adjudicator were to make findings at a later date, these would not be inconsistent with any other findings as there are none at present. [21] Applying the well-established principle in Keet Gerald Francis Noel John v Mohd Noor Bin Abdullah [1995] 1 CLJ 293, I am therefore of the view that there are no serious/bona fide issues to be tried established by the Plaintiff and Defendant should be allowed to exercise their rights according to CIPAA. Conclusion [22] Based on the above analysis, I am satisfied that Plaintiff did not meet the threshold requirements for granting an injunction. I also find that damages would be an adequate remedy and the balance of convenience tilts in favour of refusing the injunction. [23] Accordingly, Plaintiff's application in enclosure 1 is hereby dismissed with a cost of RM6000, subject to the allocator fee. Dated this: 24th March 2025 ~signed~ (NOOR HAYATI BINTI HAJI MAT) Judge Shah Alam High Court NCVC 9 Counsels: For the Plaintiff: Ong Swee Long together with Eng Yi Wang Messrs Armiy Rais For the Defendant: James Monteiro together with Prem Sanghvi